Trade-Ideas: MGM Resorts International (MGM) Is Today's Unusual Social Activity Stock - TheStreet

Trade-Ideas LLC identified

MGM Resorts International

(

MGM

) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified MGM Resorts International as such a stock due to the following factors:

  • MGM has more that 20x the normal benchmarked social activity for this time of the day compared to its average of 10.90 mentions/day.
  • MGM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $161.3 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on MGM:

MGM Resorts International, through its subsidiaries, owns and/or operates casino resorts. It operates through two segments, Wholly Owned Domestic Resorts and MGM China. The company's casino resorts offer gaming, hotel, convention, dining, entertainment, retail, and other resort amenities. Currently there are 11 analysts that rate MGM Resorts International a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for MGM Resorts International has been 8.0 million shares per day over the past 30 days. MGM Resorts International has a market cap of $11.8 billion and is part of the services sector and leisure industry. The stock has a beta of 1.12 and a short float of 6.2% with 2.56 days to cover. Shares are up 1.8% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates MGM Resorts International as a

hold

. Among the primary strengths of the company is its expanding profit margins over time. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • 38.96% is the gross profit margin for MGM RESORTS INTERNATIONAL which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, MGM's net profit margin of 4.08% significantly trails the industry average.
  • MGM RESORTS INTERNATIONAL's earnings per share declined by 22.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MGM RESORTS INTERNATIONAL continued to lose money by earning -$0.32 versus -$0.35 in the prior year. This year, the market expects an improvement in earnings ($0.57 versus -$0.32).
  • MGM, with its decline in revenue, slightly underperformed the industry average of 0.5%. Since the same quarter one year prior, revenues slightly dropped by 7.6%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Hotels, Restaurants & Leisure industry and the overall market, MGM RESORTS INTERNATIONAL's return on equity significantly trails that of both the industry average and the S&P 500.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed compared to the Hotels, Restaurants & Leisure industry average, but is greater than that of the S&P 500. The net income has decreased by 11.4% when compared to the same quarter one year ago, dropping from $110.01 million to $97.46 million.

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